Anyone doing the bike to work scheme this year

noisemonkey

Are they charging VAT now? Is it still worth it? Seriously considering a Felt Z6 in the lbs...

gtvlusso

Nope - not as worth it now with the 20%. Suspect the scheme will close at my company as no one is taking it up.

You can get a similiar or better deal if you negotiate hard out of season at a bike store.

The only reson to do it is if you want to spread payments, but allot of store offer interest free credit now anyway.

rolf_f

It's still worth it. I always got charged the VAT anyway and I still got great deals on two bikes. Just have to make sure you can do the extended rent thing.

FoldingJoe

I don't think the VAT thing is starting until next year?

I started mine in April\May and I am still paying the same.

You still obviously get the tax benefits, so will still pay less for the bike overall if as Rolf mentioned you can do the extended 3 year thing, and you don't have to pay it all up front...

fossyant

I'm not doing it again - we had to pay the VAT, so only saved on NI and Tax, and I just completed before the 20% rule came in. It also meant I couldn't claim for business miles on my bike, which adds up to £150 a year, so in reality didn't save a penny. My CTW bike is over two years old now, and our scheme has been suspended due to the Revenue shenanigans.

Just put my mileage claim in for £150 though 8)

sketchley

There is lot of miss-information about this. The VAT ruling is about adding VAT to the hire charge but only applies to VAT registered companies. So if for example you work for the BBC you never got VAT deducted in the first place therefore it will not be charged. If you previously saved the 20% this ruling does not mean you will now loose all of the benefit, as the vat you will now pay is tax free.

Example before 20% rule

£1000 Bike less VAT = £ 833.33 = 12 Payment of £69.44

£69.44 assuming 40% tax and NI = £ 41.66 net

Now as of Jan 1 you need to pay VAT on the £41.66 this = 8.33 meaning you net payment is now £ 49.99 for 12 months this is £599.90 still a £400 saving.

(Note VAT saving was £166.67 extra payment were £ 99.96 net.)

£69.44 For 20% tax payer is £ 55.55 as of 1st Jane this will be £66.66 or £ 799 still a £200 saving.

(Note VAT saving was £166.67 extra payment were £ 133.32 net.)

Actual Figure will be slightly less due to NI saving as well. Regarding FMV simply extend the hire period so you pay less.

That being said for a 20% tax payer you once you take into account FMV cost on cycle scheme (if that's who you use) to extend by three years plus the 10% they charge to the bike shop you maybe better negotiating a discount direct with the shop. But then you will need to pay up front not in 0% instalments which at 14% interesting on Credit Card for a year is worth over £100.

Personally I still think it's worth it.

Jay dubbleU

My employer is no longer doing it - they've decided there is too much paperwork with the additional VAT

optimisticbiker

Hmmm... my employer is treating it as a loan, not salary sacrifice so I'm paying £69/mo...

Can I claim this back on tax return (@40%)?

Long_Time_Lurker

Hate the fact that they have changed the rules again, but it's still worth it for me...
My bike is brand new (there is no 2011 model), so no sales, so I will still save myself £320. Stupid not to in my circumstances.

noisepolluter

I'm doing it - there is still a saving even though I don't have VAT deducted. At the end of the 12 month term there's a 7% deposit to hang onto the bike.

Overall including final deposit I'm getting something like a 13% saving.

Just waiting for the voucher to plop through the door now!